The European Union has reached a critical juncture in dealing with the fallout from the 2008 financial meltdown. Europe’s leaders took initiatives to strengthen financial systems but have been unable to secure a significant recovery of the European economy or avert growing divergences between member states in GDP per capita, unemployment rates and external-account balances.

AUGUR
A world-wide group of economists and others worldwide, led by a group of EU macro-economists - who work like a mini-UN macro-research with everything integrated across all of the world's political-economy, fully empirically expressed with dynamics lacking from World Bank Model.

Thomas Herndon, the UMass Amherst PHD student who discovered an Excel coding flaw in the famous paper by economists Kenneth Rogoff and Carmen Reinhart, which had claimed that when a country's debt surpasses 90% of GDP, then growth slows precipitously, was the man of the week.

For the past four years, the political leaders and bankers have made enormous efforts to save the financial industry, clean up the banks, and reform regulation in order to restore trust and confidence in the financial system. This hasn’t worked. Banks today are bigger and more opaque than ever, and they continue to behave in many of the same ways they did before the crash.

Sweden’s economy is faring better than that of many of its peers: the nation has low public debt and a current-account surplus, and since the early 1990s its growth rate has outpaced that of other members of the EU-15 and the United States.

Less than 36 hours remain now before a package of painful tax hikes and spending cuts start to kick in. Even if a deal is struck, it will have to be passed by both the Democrat-controlled Senate and then the GOP-held House — running the gauntlet of a gridlocked Washington on new year’s eve.

It could be argued that Pillar One of Basel II is the Microprudential constraint upon the banking institution whereas Pillar II is the Macroprudential aspect to the Bank’s capital requirement, that quantity of capital which provides insurance against the institutions interdependence with the system via its liquidity risk and exposure to macroeconomic policy alterations through interest rate risk.

The important point I suppose is that BIS sets the rules but the conceptual views of the distinctions of UL and EL and r.cap and e.cap will differ amongst the users of those rules (the banks being regulated) as they do amongst the BIS committee members and their economists.

These actions, which together will increase the Committee’s holdings of longer-term securities by about $85 billion each month through the end of the year, should put downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative.

My view is that “this Basel thing” is going to morph into what it should have been in the first place. Given the long chequered history of Banking Regulation & Supervision since "Basel II"; considering that, what might or ought the future look like?

The REH is not political even the British Labour party in opposition right now lare using an expectational argument to explain why economic stimulus is not working to break the liquidity trap at the vortex of the current massive crisis.

the sequence of items from asymptotix which tie together sequentially the pragmatic approach to adapting legacy New-Keynesian models towards Macro-financial analytics and real stress testing in a Crowded Out world.....

The EFSF/ESM construct was the backstop for the EU member states’ sovereign bond markets. The point is the EFSF/ESM framework proposal was a) not credible at all, from the moment of announcement at 4am on 10th may 2010 & quickly became perceived as evidently unworkable as the summit process repeatedly refined the announcement

Massive un-productive property investnments (e.g. shopping centres, apartment complexes) in Spain and Florida. State Aid from Netherlands Govt. like the rest of them in '09. Payment of 1.6bn needed this year. It's a 'basket case'; but the importance of this story is not 'per se' it's an example of what else is out there, not only in Spain!

The poison at the centre of this systemic institutional dysfunctionality is the unwillingness of the EUROPEAN COMMISSION cadre to relinquish the power it maintains by fragmenting European state owned financial institutions other than the ECB

Nearly a year ago I wrote a similar article. The situation keeps going getting worse and worse! The politicians promise to magically solve everything at these Summits and we are approaching fast another one.

It's going to take innovative and imaginative management, some thinking to fix this crisis and it cannot be done without an external context of political assuredness and governance which is blatantly lacking right now.

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